Wanbury export issue shows regulator miscommunication

The Maharashtra Food and Drug Administration’s finding that Wanbury shipped to four countries batches of metformin hydrochloride produced by a third party.Prabha Raghavan | ET Bureau | October 25, 2016, 08:00 IST

NEW DELHI: The central drug regulator’s attempts of having joint inspection with state bodies still seems to be far from sight, suggest the developments over Wanbury exporting an active pharmaceutical ingredient sourced from a third-party facility.

In a stock exchange filing responding to an ET story about the Maharashtra FDA finding, Wanbury on Monday said all its exports were done legally and that the Pharmaceutical Products India plant at Tarapur — the third-party facility — was the loan licensee manufacturer for the company. The company said also it hasn't received any formal notice from the state FDA.

Shares of Wanbury, which crashed during Monday morning on the BSE, recovered after the company issued the clarification. They ended the day up 3.3% at Rs53.60, after hitting a low of Rs 49.35.

The Central Drug Standard Control Organisation (CDSCO) renewed Wanbury’s written confirmation certificate to allow it to export an active pharmaceutical ingredient to the European Union, a notification dated October 18 on the regulator’s website said.

According to the regulator, the decision was made based on a June 24 inspection conducted by CDSCO’s West Zonal office in Mumbai. “Written confirmation is issued by the CDSCO based on the manufacturing facility compliance to European Union GMP (good manufacturing practice),” CDSCO’s international cell told ET in an emailed response to queries about the decision.

“As per the Drugs & Cosmetics Act, 1940, the licences for manufacturing, sale and distribution of drugs are granted by state authorities and all enforcement action with regard to manufacture of any spurious, NSQ (substandard), adulterated and misbranded drugs is taken by such authorities.”

In its exchange filing, Wanbury said, as part of protocol, the local FDA is required to issue a formal notice of its observations to the company so that it is given a fair chance to clarify the matter. “In this case, Wanbury has till date not received any official communication from FDA. The above does not have any bearing on the operations/performance of the company.”

ET has accessed the FDA report which detailed the outsourcing process of the company.

According to the Maharashtra FDA, the company exported 47 lakh of metformin hydrochloride to Mexico, Brazil, Bangladesh and Pakistan in October. The state regulator has so far not taken any action against the company. The Thane FDA is investigating this issue, an official told ET.

According to the earlier investigation by the Maharashtra FDA, Wanbury had export orders for 650 metric tonnes per month from the four countries even though it only had the capacity to produce 300 metric tonnes. The company outsourced the remaining amount to Pharmaceutical Products India, which didn’t have an export licence and also didn’t maintain manufacturing and testing records for this drug, the investigation showed.

ET VIEW

Overhaul regulatory oversight

India has the potential to emerge as the pharmacy of the world, but we need to proactively overhaul regulatory oversight. Instead of as many as 36 licensing authorities nationally, the government needs to centralise licensing powers with a central authority, as suggested by the recent report by Ranbaxy whistle-blower Dinesh Thakur.

And, it seems, no legislative amendment is required for the purpose. As per the Thakur report, the Centre ‘merely’ needs to change Rule 69 in the Drugs & Cosmetics Rules, 1945. We need uniform standards for pharmaceuticals across the country, and also for exports.

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